Cairn to seek shareholder nod for Vedanta deal

New Delhi: UK-based Cairn Energy Plc will tomorrow seek shareholder nod for the sale of majority stake in its Indian arm to London-listed Vedanta Resources for up to $8.48 billion, a development that would close options for state-owned Oil and Natural Gas Corporation (ONGC) to make a counter offer, reports PTI.

Cairn has called a general meeting of the shareholders in Edinburgh on 7th October, 2010, at 1400 hours (local time), industry sources said.

Once the shareholders approve the deal, ONGC will run out of last opportunity to make a counter offer or exercise its pre-emption right.

Sources said ONGC had so far made no approach to Cairn Energy management.

ONGC could have made a counter-offer or exercised its pre-emption rights in certain properties of Cairn India only before shareholders of Cairn Energy approve of the sale.

Then, upon acceptance of its offer by the management of Cairn Energy, ONGC would have gone to the Securities and Exchange Board of India (SEBI) for stopping Vedanta's open offer for Cairn India shares that is to begin on 11th October.

It had previously missed the market regulator SEBI's deadline for making a rival offer.

Sources said the sale is conditional upon shareholders of Cairn Energy Plc and Vedanta Resources passing a resolution to approve the transaction on or before 30th October and Vedanta Group completing an Indian open offer to minority shareholders of Cairn India.

Also, the deal is conditional upon required government consents.

The sale agreement will lapse if these conditions are not satisfied or waived on or before 15 April 2011.

Sources said SEBI is yet to approve Vedanta's open offer and any shareholder nod that Cairn Energy may secure tomorrow would be conditional to completion of the open offer.

Vedanta Group is buying 40%-51% stake of Cairn India, which owns the nation's largest onland oil field and has also made an open offer to buy another 20% from the company's minority shareholders.

As per SEBI's regulations, a rival offer had to come within 21 days of the open offer being made, i.e. by 7th September but ONGC choose not to make any offer, they said.

ONGC by virtue of its 30% to 40% interest in Cairn India's three producing assets — the giant Rajasthan oil fields, Ravva oil and gas field in KG basin and CB/OS-2 in Gujarat offshore — had claimed pre-emption rights.

Mimicking Australian mining firm BHP Billiton's strategy of diversifying into oil, billionaire Anil Agarwal-run Vedanta is buying Cairn Energy's 40% to 51% stake in Cairn India and has made an open offer for a further 20%.


Wednesday Closing Report: Stock lock

The market opened firm on positive announcements from various central banks. Investors took the opportunity to book profits after the indices touched their fresh 33-month highs in early trade. Choppy trade led the indices lower in post-noon trade but a decent recovery ensured a closing well above the day's lows.

The Indian market opened strong this morning on positive cues from across the globe. The key barometers touched new 33-month highs - the Sensex scaling 20,670 and the Nifty touching 6,223 - soon after the opening bell. The BSE Consumer Durables (CD), BSE Auto, BSE Public Sector Undertaking (PSU) and BSE Power indexes touched their 52-week highs in the morning session. Profit booking led to a gradual fall with the market touching its intraday low in post noon trade. They staged a decent recovery on bargain hunting by investors, making sure that the market ended well above the day's lows.

The Sensex added 135.37 points (0.66%) to close at 20,543. The index touched a high of 20,670 and a low of 20,447 during the session. The Nifty settled at 6,186, up 40.65 points (0.66%). The benchmark swung between a high-low of 6,223 and 6,148, respectively.

The market breadth was in favour of the gainers today. The Sensex ended with 20 advancing stocks while 10 ended in the red. The Nifty had 33 gainers and 17 declining stocks. The broader indices outperformed the key benchmarks for another day; the BSE Mid-cap index surged 1.10% and the BSE Small-cap index advanced 0.75%.

The top Sensex gainers were Jaiprakash Associates (up 6.69%), Sterlite Industries (up 3.95%), Hindalco Industries (up 3.62%), Reliance Industries (RIL) (up 2.09%) and Jindal Steel (up 1.88%). The laggards on the index were Mahindra & Mahindra (M&M) (down 0.77%), Hindustan Unilever (HUL) (down 0.72%) and State Bank of India (SBI) (down 0.54%).

The sectoral gainers were led by BSE Realty (up 2.75%), BSE Metal (up 2.25%), BSE Oil & Gas (up 1.09%), BSE Capital Goods (CG) (up 0.95%) and BSE Public Sector Undertaking (PSU) (up 0.84%). BSE Fast Moving Consumer Goods (FMCG) was the lone loser in the sectoral space, down 0.35%.

Hiring by India Inc surged by 22% in September this year, driven by improved confidence in the economy, according to a report by job portal

According to the monthly Naukri Job Speak Index, hiring level rose to 943 in September this year, from 773 in the same period last year.

Markets in Asia ended mostly higher on positive announcements by various central banks. Earlier assertions by the US Federal Reserve of taking new initiatives to spur the world's largest economy also rekindled investors' interest in riskier assets.

The Hang Seng gained 1.07%, KLSE Composite rose 0.31%, Nikkei 225 jumped 1.81%, Straits Times advanced 0.88%, Seoul Composite was up 1.33% and Taiwan Weighted was up 1.02%. On the other hand, the Jakarta Composite closed 0.18% lower, bucking the trend.

Investors looking to park funds in commercial real estate are likely to increasing turn their attention to emerging economies in the Middle East, South East Asia and Asia-Pacific.

"Commercial real estate is completely and perfectly correlated one-to-one to the broader economy. The macro economic climate and the health of the financial system are the two driving forces that dominate real estate value," said Ethan Penner, president of CB Richard Ellis (CBRE) Capital and executive managing director of CBRE Investors, Asia and Asia Pacific.

The US market ended higher on Tuesday on higher-than-expected services industries data and hopes that the Federal Reserve, like the Japanese and Australian central banks, will take new steps to boost the economy. The ISM index rose to 53.2 in September from 51.5 earlier. Investors' confidence was also boosted by the Bank of Japan's move on Monday. The Dow rose 193.45 points (1.80%) to 10,944. The S&P 500 rose 23.72 points (2.09%) to 1,160. The Nasdaq rose 55.31 points (2.36%) to 2,399.

Foreign institutional investors were net buyers of stocks worth Rs671 crore on Tuesday. Domestic institutional investors were net sellers of Rs803 crore in the equities segment on the same day.

Animation and game entertainment and distribution major DQ Entertainment (International) (down 2.05%) has signed a co-production pact with a French company for the animated series of 'Lassie and Friends.'

The agreement with France-based Super Prod and Story Board in association with French broadcaster TF1 has a global pre-sales budget of €7 million, according to a filing with the Bombay Stock Exchange (BSE).

Super Prod will hold the rights of the 52-episode animated series of 'Lassie and Friends' for French-speaking Europe and will exploit the French version of the series worldwide, DQ Entertainment stated.

Realty major Parsvnath Developers (down 0.07%) today said it has raised Rs269.52 crore through private placement of shares with institutional investors and the funds will be utilised for execution of ongoing projects.

The company, which had launched a qualified institutional placement (QIP) of equity shares last week, will issue 1.9 crore equity shares at Rs141.57 apiece, Parsvnath informed the Bombay Stock Exchange (BSE).

The company will utilise the funds raised through the QIP for completion of ongoing projects and not to reduce its debt, which has come down to about Rs1,300 crore at present from a peak of Rs2,200 crore.

Tantia Constructions Ltd (up 2.12%) has informed the Bombay Stock Exchange (BSE) that the company has received a project from South Eastern Railway, Kolkata for construction of a major bridge over the national highway near Bagnan. The project includes girders and a major bridge over the Damodar River including substructure, transportation, erection and launching of super structure, earth work, minor bridges and other miscellaneous works worth Rs30.71 crore.


Personal finance Thursday

ICICI Bank, Andhra Bank increases base rate; General Motors gives discounts on cars; Corporation Bank signs MoU with Toyota Kirloskar Motors for auto retail finance; Allahabad Bank signs MoU with Hindustan Motors for commercial vehicle finance; ICICI Home Search and Vijay Group tie up for Orion in Thane; BSE Training Institute launches certificate program on currency markets

ICICI Bank, Andhra Bank increases base rate

ICICI Bank has increased its base rate by 0.25% with effect from today. The revised rate will be 7.75% per annum as against 7.50% per annum at present. The fixed rate loan customers will not be impacted by the above increase and their contracted rates will remain unchanged. The Bank has also increased its interest rates for various tenors of retail fixed deposits by 0.25% to 0.50% with effect from 6th October.

Andhra Bank has also increased the base rate by to 8.50% from 8.25%.
With effect from 1st July, interest rates on new loans and advances, including consumer loans, are determined with reference to base rate. The base rate is the minimum rate at which banks can lend loans.

General Motors gives discounts on cars

General Motors is giving discount ranging from Rs12,000 to Rs70,000 depending upon the model of the cars. The company has not increased the prices, and is giving discounts on different models of its cars.

The festive offer has been made in view of the ensuing Navratri and Diwali festivals. P Balendran, vice president (corporate affairs) said, "These are special offers/schemes for the festive season which have been rolled out. The special offers vary from model to model and include schemes like free maintenance for three years or 45,000km whichever is earlier. The other offers include Chevrolet Promise Cashless Ownership Offer, some cash incentives, corporate discount etc."

Corporation Bank signs MoU with Toyota Kirloskar Motors for auto retail finance

Corporation Bank has signed a memorandum of understanding (MoU) with Toyota Kirloskar Motors to extend auto retail finance. Corporation Bank will be one of the preferred financiers for the entire range of vehicles sold by Toyota Kirloskar Motors.

Allahabad Bank signs MoU with Hindustan Motors for commercial vehicle finance

Allahabad Bank has signed a memorandum of understanding (MoU) with Hindustan Motors for commercial vehicle finance. According to the agreement, the Bank will be a preferred financier of the vehicles manufactured by Hindustan Motors. Dealers of Hindustan Motors and Allahabad Bank branches will be sourcing business using their own customer database.

ICICI Home Search and Vijay Group tie up for Orion in Thane

ICICI Home Search in association with Vijay Group provides an opportunity to buy apartments in Mumbai. ICICI Home Search is a division of ICICI Finance Company Ltd. Located in Thane, off Ghodbunder Road, the project-Orion will be completed in approximately three years. The project is approved by ICICI Bank Home Loans for funding. Orion will have three towers of 27-storey each and three podiums. It will also include amenities like club house, children's play area, community party lawn, library, jogging track, health club etc.

BSE Training Institute launches certificate program on currency markets

BSE Training Institute (BTI), the training division of Bombay Stock Exchange Ltd, will launch a certificate program on currency markets from 22 November 2010 to 15 January 2011.
The program will consist of interactive lectures, case study discussions and hands on exercises will conclude with an online assessment. To ensure application of knowledge, the program will include a workplace project. Successful completion of the project work is a pre-requisite for obtaining the final specialisation certification. In addition, participants will get to learn the live online Forex Trading platform used by the United Stock Exchange of India Ltd.

Seats will be allotted till 16th November. The course is spread over eight weeks. The course will be conducted from Monday to Friday (evening 6:30pm to 8:30pm). Fees per participant is Rs19,500 plus service tax of 10.30%. Total amount is Rs21,509 per participant. Students are eligible for a 10% discount on submission of current year student identity card. The course will be conducted at United Stock Exchange of India Ltd in Mumbai.


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